There’s no other way of putting it; auto insurance is expensive, and it is very difficult to find great auto insurance companies that offer great coverage at an affordable price. But did you know that the price that you see for any auto insurance is specifically for you? Everyone gets a different insurance quote based on many factors. So someone might be paying half of what you are paying for the same insurance policy.
There are so many factors that impact your auto insurance rates, both positively and negatively. Your driving record, insurance gaps, credit score, etc are some of the factors that are considered before you get an insurance quote. But did you know that driving under the influence (DUI) or driving while intoxicated (DWI) can increase the cost of auto insurance? We are not talking about a few dollars, but as high as 70% more than the current price!
How do DUI and DWI affect your insurance rate? And why do they affect it? This article will talk about everything you need to know about auto insurance pricing, the difference between DUI and DWI, and how it impacts your insurance rates.
How Insurance Companies Operate
To understand how DUI affects insurance rates, let’s see briefly how insurance companies operate. Every insurance company, including the best auto insurance companies that offer the most affordable rates, is a risk-management company. To make money and operate, they must reduce the risk to as low as possible.
So whenever you buy auto insurance, the company assesses all the possible risks associated with you, your driving skills, and the area you live in. If there’s a higher risk associated, to offset the possibility of an insurance claim (which costs the company a lot of money), they charge more. If the risks are low, they charge less, since they want low-risk people to pay premiums while not making any claims.
This is how every insurance company works and earns. More risk equals more losses, so the companies try to cut that with higher premiums and insurance rates. So how does DUI affect your insurance rates?
Difference between DUI and DWI and DWAI
DUI stands for driving under the influence, and this influence could be due to anything. It can be driving while having alcohol, drugs, prescription drugs, etc. Anything that influences your motor skills and reasoning abilities, making you incapable of driving will be considered under DUI.
DWI stands for driving while intoxicated and this is the charge you get when driving after having too much alcohol. Different states have different definitions of drunk driving, but commonly it is when your blood alcohol level is more than 0.08%.
DWAI stands for driving while ability impaired and this charge encapsulates the other two along with others. For example, driving while drunk will be considered DWAI since your ability to drive has been impaired. But not just that, if you are feeling sleepy and still driving, it will come under DWAI. You don’t have to be under the influence to be charged with DWAI.
How DUI and DWI Affect Your Insurance Rate
Perhaps the most impactful factor in affecting your auto insurance rates is a DUI/DWI charge. You have no idea how seriously insurance companies take a DUI charge. If you were not aware, some statistics would enlighten you. Trust us, these numbers would make you never drink and even stand near a car again!
Every auto insurance company will increase the insurance rates after a DUI charge, no matter which state you are in. And if this increase is as high as double, consider yourself lucky, because data shows that in some states, the insurance rates quadrupled after a DUI charge!
On average, there’s a 70% increase in insurance rates, which is around $1,600 more than normal rates. When it comes to the price hike, State Farm and Progressive are the best options, with a price hike of just around 15%. But if you have Allstate or USAA, then be prepared to shell out almost 50% more than what you are paying currently.
The worst, in this case, is Geico. While it offers great prices and coverage, a single DUI can increase your insurance rates by almost 150%! But not just companies, even different states treat DUI differently.
DUI Insurance Rates in the Different States
Every state’s definition of DUI/DWI is slightly different, but the insurance rates will increase for DUI/DWI no matter what the definition is. What the difference would depend. For example, if we take New Hampshire, after a single DUI, the price of auto insurance rose by almost $1,600. This in itself is a huge jump, but now let’s make it sound like dimes and pennies.
In Michigan, a single DUI charge can increase the annual cost of auto insurance by almost $9,000! Imagine paying $9,000 more (that’s $750 every month) just because you had too many drinks and wanted to drive around.
No matter what insurance company you go for, or which state you are in, a DUI/DWI will increase the cost of auto insurance by a lot. But even if the hike was just a few hundred dollars, it still is too much because you’re paying the extra amount for nothing. The best way to avoid it? Stop driving while being drunk.
Not just a steep increase in insurance rates, but the DUI charge will be on your driving record for years, and on your CLUE report as well. This means that you’ll not get cheaper insurance rates for almost 7 years. Could be more if the insurance company decides to. So stay safe, and save more money on auto insurance.